GLOBAL MARKETS
Trump’s tariff war for the sake of USA long term benefit is the Main Objective for Donald Trump and Vance Government as they saw a lot of future benefit for the US country and the US people. Here are the two major impact from the Tariffs implementation that Trump’s government would like to see within near term :
• Trigger the Domestic Price Rise > will benefit for production, manufacture and business income to rise but will definitely hit the Inflation.
• Pressured the International Prices Decrease > will benefit US Trade Balance and in house cost production to be lower.
On the Global Equity Market, Globalist was blamed by Trump as they are the source in draggingdown the US market and Global market.
It is also create the market risk goes to wildly higher using the negative market sentiment such as:
▪ emotional biases and herding behaviour,
▪ feedback loop between sentiment and fundamentals,
▪ too emotional in response market news and events,
▪ overreaction and underreaction market.
On the other side, the recent data from CNN report about the global market survey which is show Negative triggered by the spike of ‘Extreme Fear’ among the investors and hit extremely to the US bourse like S&P 500.
Investors who are holding more cash are currently expecting another ‘the bottom momentum’ to hit and win back their losses in market.
The Fed kept the federal funds rate unchanged at 4.25%-4.5% during its March 2025 meeting, extending the pause in its rate-cut cycle that began in January, and in line with expectations.
Policymakers noted that uncertainty around the economic outlook has increased but still anticipate reducing interest rates by around 50 bps this year (still sees 2 rate cuts in 2025), the same as in the December projection.
US market manage to U-turn and continue the gain momentum after in negative territory for more than 2 weeks and the investor starting back to market again before too late or ‘miss the rally train’
The expected of Trump’s tariff is purely to create the better value for US Domestic price rather than keep buying import stuff with higher price that create high inflation in the future.
Be greedy when others are fearful
Over the past 10 years, the Nasdaq has corrected six times, good for about once every 1.67 years. So, the good news is that a correction is a regular, maybe even healthy, part of markets.
On the other hand, sometimes corrections turn into a full-fledged bear market, which is a correction of more than 20% and usually lasts much longer than mere corrections.
Given the highly uncertain impact of tariffs, investors looking to add to their stock portfolios at this moment should stick with high-quality, relatively "safe" stocks that have, nonetheless, experienced pullbacks but could also weather a full-blown recession if it comes to pass. That's why the following Magnificent Seven stock looks so attractive right now.
Source: By Billy Duberstein – Mar 23, 2025
GLOBAL MARKETS
Optimism around the country’s artificial intelligence capabilities has intensified since the introduction of DeepSeek’sR1 model earlier this year.
Valuations in China look attractive while concerns are growing about the state of the U.S. economy.
The MSCI China Index is currently trading at 13.38 times its projected one-year earnings, according to FactSet. This compares to the S&P 500, which is trading at 20.72 times projected one-year earnings.
Beijing pledges greater market access as top global CEOs gather at the China Development Forum while Morgan Stanley has raised its 2025 economic growth forecast for China by 50 basis points to 4.5 percent, in line with market expectations, due to a stronger-thanexpected starting point and robust capital expenditure momentum.
China and Asia Pacific should be able to recover and became very attractive to put as ‘overweight’ market.
INDONESIA MARKETS
Indonesia are facing real challenges with complex situation while positive indicators seems fade away and unjustified in term of fundamental valuation, starting from:
> Investors are too fear and act unrealistically during the transaction in capital market which create chaos and panic selling.
> Labor firing is still the big concern for many middle class and trigger the rising of holding cash position as the effect of vulgar living (stop spending).
> Rising of tariff after Idul Fitri such as toll fee will increase the people’s cost of living.
> The waiting of DANANTARA Indonesia result still the ‘blue sky’ hope which many sceptical showing in public.
❖ IDR will definitely sticky in between range 16.200 to 16.940 for the rest Q2 until there is a clarity of global market and the increase inflow from foreign investor to Indonesian Financial Instrument especially to Stock and Bond.
❖ Indonesia Foreign Exchange Reserves up $2,6 Bio to became $157,1 Billions from $154,5 Bio.
❖ This marks the highest level on record, bolstered by tax and service revenue inflows and foreign l oan withdrawals by the government.
❖ The latest figures are sufficient to cover 6.7 months of imports or 6.5 months of imports and government foreign debt payments, and were above the international adequacy standard of around 3 months of imports
OVERVIEW MARKETS
Globally, investor still high hope with US Stock Market as the mature and biggest market.
❖ Asia, China will definitely the barometer and they will change the investment cashflow distribution from majority in US market to another region such as Asia, America Latin or Europe.
❖ Gold and Fixed Income Assets will be the current favorite until the market getting certain and more predictable.
❖ Indonesia will be the next favorite for domestic investor while waiting the Global and Asia investor to come back again.
Investment Call
Global and Asia Market
➢ Overweight in USD denomination Fund or Asset class such as US Tech Stock Fund, Asia Mixed Tech Fund, including China Market. Indonesia Market
➢ Overweight inUSDdenomination Fixed Income Fund and Money Market Fund (with underlying sovereign and corporate bonds).
➢ Overweight in IDR denomination Bonds with maximize tenor 5 years or less (either corporate or sovereign).
➢ Selective allocation in Indonesia shares, especially in Banking sectors, Internet and Data centre sector, and Commodity.
DISCLAIMER
The information contained in this presentation has been obtained from public sources believed to be reliable and the opinions contained herein are expressions of belief based on such information. No representation or warranty, express or implied, is made that such information or opinions is accurate, complete or verified and it should not be relied upon as such. This presentation does not constitute a prospectus or other offering documents or an offer or solicitation to buy or sell any securities or other investments. Information and opinions contained in this presentation are published for reference of the recipients and are not to be relied upon as authoritative or without the recipient's own independent verification or taken in substitution for the exercise of judgment by the recipient.
All opinions contained herein constitute the views of Batavia Prosperindo Aset Manajemen's Investment team, they are subject to change without notice and are not intended to provide the sole basis of any evaluation of the subject securities and companies mentioned in this presentation. Any reference to past performance should not be taken as an indication of future performance. No member company of the Group accepts any liability whatsoever for any direct or consequential loss arising from any use of the materials contained in this report.
